Fuel subsidy cut increases burden on workers, says trade union group

Gopal hopes the government will force employers to provide a cost of living allowance and increase the minimum wage to help Malaysians cope with the increase in fuel price and potential inflation it will bring. – The Malaysian Insider pic, October 2, 2014.

Although Putrajaya has described the fuel price hike of 20 sen per litre as “minimal” and “not a burden”, the Malaysian Trade Union Congress (MTUC) thinks otherwise, saying the increase is steep and will have an impact on the disposable income of private sector workers.

Its secretary-general N. Gopal Kishnam said the 10% upward revision in the fuel prices would have a snowball effect on other goods and services.

“About 40% of the 13 million workers who earn less than RM2,000 a month will be further affected,” he said in response to Putrajaya’s move to raise prices 13 months after the last increase.

RON95 will now cost RM2.30 per litre, up from RM2.10, while diesel will be RM2.20, an increase from RM2 previously.

Although the government has reduced the fuel subsidy, it is estimated that it still needs to spend over RM21 billion to subsidise RON95, diesel and liquid petroleum gas for 2014.

Gopal said over the past year workers and their families have had to adjust their lifestyle due to the rise in living cost.

“Now this increase will further force them to make adjustments and then there is the Goods and Service Tax of 6% waiting for them next year,” he said.

He said it was pointless for the government to give a one-off payment of RM500 under the Bantuan Rakyat 1Malaysia programme because it was not sustainable.

Gopal also said wages of private sector employees were supresssed because employers could rely on cheap foreign labour.

“MTUC hopes the government will, in the 2015 Budget, persuade private sector employers to give cost of living allowance of about RM300 a month to employees and revise the minimum wage from RM900 to RM1,200,” he added.

He also said politicians in power should be prudent in spending taxpayers’ money.

“Those in power and authority must also practice simple lifestyle and not indulge in extravagance. Do not ask the average man to further tighten his belt,” he added.

Furthermore, he said, corruption and wastages should be also checked as a lot of resources could be saved. – October 2, 2014.